Sean O’Brien’s rich 2023 contract is a loser for laid-off workers.

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By The Editorial Board – Oct. 28, 2025 5:53 pm ET – Wall Street Journal

(3 min)

Teamsters chief Sean O’Brien Chip Somodevilla/Getty Images

Teamsters chief Sean O’Brien sold the union’s 2023 contract with United Parcel Service as a big win for workers. Two years later it’s looking like the bad bargain of the century, as UPS said Tuesday it has cut 48,000 jobs this year in a major effort to shave costs it can’t afford, including employee wages and benefits.

UPS shares rose 8% Tuesday after the shipper reported higher than expected profit during the third quarter thanks to bigger than forecast cost savings. UPS previously said it would cut 20,000 jobs and close 73 facilities while it shed half of its delivery business for Amazon, its largest customer. Rising labor costs had slimmed margins for many Amazon deliveries done by UPS.

The company’s Teamsters contract raised average compensation for full-time drivers to $170,000 from $145,000 over five years. That’s the equivalent of about $80 an hour. Teamsters also get up to seven weeks of vacation and don’t have to pay healthcare premiums. Trouble is, the agreement put UPS at a competitive disadvantage to Amazon and FedEx.

Businesses that lose money and are uncompetitive won’t survive. See trucking company Yellow Corp., which filed for bankruptcy in 2023 in part owing to Mr. O’Brien’s labor militancy. Mr. O’Brien refused concessions and tweeted an image of a tombstone “Yellow: 1924-2023.”

UPS doesn’t want to be Mr. O’Brien’s next victim. The Teamsters boss has insisted that its contract requires UPS to create 30,000 jobs. He hasn’t read the fine print—or is misleading his members. UPS merely committed to giving part-time employees a chance to apply for some full-time job opening. If UPS reduces job openings, workers don’t have an opportunity to fill them.

Advances in robotics are making it easier for companies to replace workers, and Mr. O’Brien may have a harder time replacing members who lose their jobs. Workers do best when their employers do well. That’s an eternal lesson that union bosses ignore when they pit “labor” against managers, and workers suffer the most.